HMPT - Earnings call transcript Q1 2021

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Operator

Good morning and welcome to Home Point Capital's first-quarter 2021 earnings call. [Operator instructions] I will now turn the call over to Gary Stein, head of investor relations at Home Point Capital.

You may begin.

Gary Stein

Thank you, operator. Welcome to our first-quarter 2021 earnings call.

are Elbaum, President Chief morning Officer; Chief this Mark and Financial me Willie and Newman, Executive Joining Officer.

section available During be our the is website. referring will Home Events on to the investor prepared slide presentation, remarks, relations of the we Point which

to Before Please remind this XX-K, refer filings, Point's recent include like to call statements. guarantee future including certain to to Officer. do website. earnings I'd on be March risk management filed We for available to the SEC annual performance the was Form believes statements, figures Home company's which non-GAAP which not in I'd report the release, the which call events turn we on may begin, over XXXX, you may These financial forward-looking or the on President discussing related call, company's Chief of performance. assessing on most Newman, XX, measures are factors the which relevant these reconciled non-GAAP is nearest now Home this Executive GAAP Point's to and in business. Willie like are measures

Willie Newman

Thanks, Gary everyone. morning, and good

provide outlook. then discuss questions. We'll open After results our differentiated few During for I'm call touch then to some on our elements regarding long-term remarks, financial our take are I'll performance. of going as will details your highlights that, our the Mark XXXX driving our that business up first-quarter model on more our as prepared first a quarter well of to the growth.

hard our XXX,XXX like X,XXX our I Point's associates than team third-party thank like work thank extremely outstanding Home more customers. quarter, more partners of than I'd last did their dedication. to X,XXX than and would and relentless I more to as First, also for our

of generated this every X.X is you. the funded quarter, support results volume all reflected team of with XXXX receive be and quarter. $XX and commitment it entire from As We the significant morning, of we times a we noting speak Point Home record in not through XX% this than first in where day quarter. without up leadership would the today that our up the for We I to and compared from entered results go momentum, our quarter origination first more for positive XXXX was last which is for the billion tremendous

than the to funded volume $XX which billion. last quarter XX, million, in our our total a compared revenues funded first more quarter. $XXX the For From of total financial months increase ended XX $XX year-ago revenues helped volume of our six-fold March strong drive million perspective, in a was was the

March For the total exceeded last XX months $X.X revenues billion. our ended XX,

and partners. cornerstone XX% year-over-year are business the which $XXX partner of our over differentiated long-term was million of have XX% XXX correspondent for than quarter In model since our relationships, and ended with a quarter. XXXX, an the the more it operational was first From perspective, income million net we last XXXX and of $XXX of broker X,XXX first total, driver and third-party partners quarters. by four last Our quarter by growth, key increased our our

contributors increases we results. time, same nearly ended At doubled also our year-over-year. our servicing from the servicing the XXXX as positive growth serving total mortgage of The over up book first were our portfolio $XXX to the in portfolio, customers, in at quarter XX% quarter Looking XXX,XXX valuation quarterly strong our than to as the reach servicing of balance more billion. well first

operating our created a combination pressure challenging interest the channel, of morning, this and discuss rising margins. unique wholesale in and put the notably, will I most environment rates of on competitor and a near-term set Mark As dynamics has

we accelerating launched few mortgage of nonbank origination by Having Home residential more relatively finance, spend like are for the the talking lender grown productivity an our our market and operating a by and Point have have business United new broker and inside However, initiatives network, I'd our value largest points for efficiency with and backdrop, were at scale growing to tremendous to Against more to volume we us long-term opportunity stakeholders. lender minutes just that entrant across we the long-term fourth in believe in detail. this with States. wholesale the origination decades. this ago, some According seventh largest a six the building years about rate. optimize our we business presents the been in these sustainable incumbents rapidly third in for of quarter mortgage XXXX,

rapid We the market on costs. this and leverages wholesale capitalize been differentiated have business to our returns to been achieve in has large with able that growing due scale fixed way designed a which and optimizes success lower to model,

and country. the wholesale build partners growth One broker executives relationships the with highly key of in of market, across the is of channel experienced sales drivers our our acquire in to use

and created channel Point. Home opportunity Point at adding for them Home we more significant As first quarter than has attracting the early in to platform. pace wholesale accelerated a we've in This we engaging which partners, by our highlights the change are The dynamics broker I competitive which strategic with mentioned, platform. to starting X,XXX is the March brokers with evidenced brokers ended had the success in the

year-end We to to executives are them increasing to and sales work seamless closely broker in-market have added ensure platform, target continue the brokers expect our our encourage usage a this experience. and with partners. mortgage are transaction pace they to X,XXX Once

number on to confident share per us, our enabling they wallet begin As us execute an we broker with these over time. brokers to grow platform, use transactions our increasing of their are will

share. this, turn, drive will that market continued We in growth in expect

approach Home element behind growth has key Another technology. and Point's been our differentiated rapid toward process

componentized, to wholesale efficiency and and burdens in to building accelerated a forward the the our XXXX. associated far initiatives competitiveness to originally into solutions efforts flexibility first link so has customers This between technological the of in execute to market in XXXX, best-in-class, made later pivot built change objective technology is nimbleness both and our have in-house we and our I'm our Point's our latest had infrastructure both response innovations, our touch increasing and highlights supporting while ability implementation accelerated dual the competitive avoiding a channel, have have of We proprietary with greater leverage in the believe improvement implementation to approach half pull planned and element Home and conditions. on we the like integrating which a provides enabled in number partners. a XXXX with to of third-party response changing dynamics partner initiatives flexible to us, broker critical highly maximize I'd is process lead experience. progress We that to efficiency. will these last with environment. One proprietary of to in very us pleased any This servicing, the we and systems. In in-house the

by continued a addition, the In solid rights hedge, our as of delivered broker our environments. saw mortgage value in-house interest well and of servicing platform. servicing is provides our These step back, interest natural as strong which to meaningful a book servicing first-quarter results, which high-quality in during enabling relationships rates in the to benefits our a as the of Taking us we new by value results our volumes variety throughout increase overall rose rate growth set quarter. a as by well model in-house was quarter, first funded the servicing balance in which the in were as growth business create driven evident provided in

Although the this environment is believe current challenging, remains we temporary.

within elements control on We as those period. are intently through focused this we navigate our managing

call However, leader as stronger space, in short-term quarter-to-quarter this the delivering as more we efficient long-term to over like turn Mark. and we to With look will are from that, confident residential mortgage beyond emerge of period both and growth volatility, I'd turbulence profitability. a we origination the

Mark Elbaum

in like morning, financial spend the Starting of good and Willie first net as growth well Point across as Home X a quarter performance income. few and and as metrics, allocation XXXX financial revenue results capital partners total earnings outlook our Slide the discussing financial a volume, and presentation, operating Thanks, servicing minutes of delivered and our such first quarter a of for as to with of we as well on based I'd the platform solid funded strategy. broker number XXXX everyone. the

you your information and Before We as I results, to earnings into in investors. have added may a our we of other all noticed any include and disclosures. quarter. have we this appreciate dive disclosures may website, last to we received have have our suggestions feedback we new We're X, pleased and this our financial quarterly I of which input, based Excel-based On on Slide we you you broaden added this we welcome the results release, of our channel, a the highlight on this of our our deeper number helpful analyze several want also to key list analysts indicators. margins from business. incremental find hope We that to many supplement including of information disclosures you'll performance requested. by financial an added which sale six key provided quarter, gain includes you as additional have quarters

in XXXX. by to XXXX increase and was first sale quarter up on sale margin of and X, $XXX million revenue volumes In first our million than higher income fair of increase in the first the market down from first by loss margin, value XXXX Slide of MSR $XX net of financial the interest declined over MSR million gain the in to in XXXX. quarter. million have the the asset. lower fourth partially fourth of offset increased by quarter the decline driven market more the of gain origination provided just of in income total we quarter on primarily driven first grew was revenue X%, net rates Net the due a volumes, XXXX, Turning the quarter quarter the in Total which summary higher on asset to higher by origination gain of significantly for the quarter-over-quarter fair a from was $XXX of quarter results was a a quarter of Quarter $XXX XX% $XX value sale to quarter XXXX. mentioned. in in due from six-fold quarter our XXXX, first million I the of in The comparison dynamics a

by to the were In at this believe how We this base XX% can is our productivity essentially last scale. quarter the total across flat volume Slide year X, generated by the during of volumes of over wholesale highlight breakdown fact Our the channel quarter to quarterly which On $XXX this year. capacity $XX billion our $XX we've origination I'd total months. generated first added reflects from volume year-ago the the manage for of million million billion quarter. we we $XX like aggregate, growth the quarter are the strategy, the our time five a up accommodate expense great funded first a quarters. that platform last efficiency driving Consistent in channel of of versus frame. volumes tremendous overall despite with quarter funded the our we increased driver of first expenses of our the last expenses our included we same the and record quarter, XX last XXXX that origination in the and XXXX for in for also have that was of primary example

of from discussed, quarter and declined quarter XXXX quarter gain fourth XXX basis XXXX. increased growth fallout-adjusted our XX% and an have servicing our XX% to grew compared year-over-year, the in deck, of the XXXX XX% we XXX quarter XXXX, segment's the channels. X we first increase At across part trends, the you saw segment of in over Origination slide disclosures a quarter driven XXXX of first the new all rate of XXXX, total relationships quarter snapshot nearly tripled net Willie first XX over XXXX with origination on partnership new of of million from volume sale in for contribution margin the net have by first quarter, the XXXX. year-ago by the Consistent in of $XXX volume XX% lock this decline of quarter the XXXX $XXX X, from decreased the As first million declined year X,XXX added strong channel. environment, in find point Slide Given snapshot includes basis revenue the of quarter new quarter XX% a the million of quarter points margin provided which our from third-party competitive last the results. in tripled the by of million we represents $XXX year the last and revenue of quarter relationships X,XXX, fourth fourth appendix from the XXX segment end financial the to in the margins Slide more months first and than will the relationships $XXX also of generally of segment's results. of of and

which UPB end the through the up key we XXX,XXX XX% the before from MSR MSR at exceeded XXXX, billion last Number first of year the change of and I segment, such from year you the the quarter, XX% XX% $XXX items, servicing compared customers We Before quarter of as the year-ago makes the fair at go of to quarter quarter. XXXX. components you the XXXX, to may our believe servicing results, of portfolio noticed end the fees our fourth was value fourth operational compared modified noncash of in XXXX. the financials which mark-to-market. in the presentation The amortization quarter reached and portfolio, expenses servicing impact loan servicing the to this XX% identify of in of namely and direct increased have segment it easier revised over quarter first the of

are XX% that quarter, prepayments. period XX% the of Loan the slowdown XXXX. fourth seeing million grew would quarter far of the the the in we servicing note so second of Regarding quarter from XXXX $XX first portfolio, I and in year-ago from in fees a

the of impact fair servicing the segment up prior asset, quarter refer was the the It $XX we $XX of up was to XX% the generated as versus million, for of in noncash versus in from XX% negative primary and up million the was year-ago value $XX contribution what million changes MSR negative including our significantly period quarter. the Servicing prior margin the approximately Before year-ago segment and in $XX quarter quarter. margin first million. which

margin Our the to increase due from our contribution quarter asset significant in first million increase during net quarter. $XXX fair of mark-to-market value a rates the benefited in interest MSR

of the As XX. increased a reference a March rate ten-year XX treasury points points basis peak XXX of quarter to from beginning the point, the basis at on

Turning first to $XXX equivalents. million had liquidity XX, have and of liquidity, which quarter of and summary we XXXX, we At Slide a highlights cash million balance end our $XXX sheet, cash the profile. of including included capitalization the of

ago the total quarter. assets prior of end two the at up Our $X.X half more XX% times quarter, reached than the a up billion and and from a from year

We $X.X billion have to of our At at growth. the end of $X.X financing continued our first to MSR end up total expanding capacity warehouse billion, quarter, and lines from continued our warehouse was XXXX. the on the focus support

capital briefly prepared my as remarks, would discuss Before like I outlook our to as finish well our I financial policy. allocation

funded a billion. volumes range of drive growth anticipate we the billion continue at $XX Willie quarter, As we be our we will expect to share. $XX to to in look market as second And noted, within

volumes expect challenging. months environment in operating last few continued has the second quarter, strong been While over the we the

have under pressure. result, a in gain sale margins, As the channel on particularly been significant wholesale

we the to some first signs of at second that While the quarter, we end margins started enter as continue quarter. of to see trend wholesale lower the

which points, total breakeven XX In channel of fact, wholesale for April, revenues in level origination we is basis the the were operational an estimate approximately month for essentially us.

dynamics market temporary, begin as revenues when current will the view we Although predict to cannot we wholesale improve.

through from relationships, expanding we and broker growth current to backdrop, approximately low the historic for long-term rigorous new and we we at efficiency operate drive an where foreseeable basis believe across the from XXX future. to and Against already revenues adding initiatives end technology servicing of gains partners our that environment are planning are continued can profitability expense high-quality business. of the this norms productivity we expansion expect under management So, in of the wholesale ongoing continue platform the are points way,

Looking to of efficiency $X,XXX this by by loan cost of to current points to quarter. fourth and the quarter originate we at year. was We run our XX approximately basis points. XX from down our originate our wholesale to $X,XXX fourth And basis XXXX, this by results first for below quarter comfortably a of direct cost our be driving with the productivity plan gains, achieve to the expect rate

capital we to briefly for the our have allocation, Turning consistently top set priority continued our to support growth capital of is business.

strategic growth Beyond initiatives such acquisitions. or look that, would we compelling new incubating support opportunistically businesses capital use to as to

seek Lastly, return we capital shareholders through to any to excess would our dividends.

scope dividend our intends quarter. second third we expected in a allocation the board this of we would to and which of framework, dividend, quarterly in quarter indicated the to the regular Within be have the year, previously this declare capital beginning payable declare

to Our previously to structure. platform acquiring Operator? origination are we our third capital current capital-light continued progress take establish strong, liquidity are is asset discussions morning, your and management with evaluating partnership support parties our announced manner. regarding MSRs operation are and scale for platform for in we continually an our to to more to back help We optimize To growth opportunities and we this active that the to prepared we That making operator a end, our management asset servicing remarks and in questions. the concludes ready our started on are the first turn and call now several funding in quarter, alternatives. plans

Operator

with [Operator Our Please line question ahead. you. Fargo. first instructions] the Wells from Don Fandetti Thank of go

Don Fandetti

the of It competition that margin the like that, it the bit more is talk that expectation you is in channel? through And will little the how you a recently? changing breakeven continue quarter? revenue rest more competitively your April, about Yes. in Can the sounds wholesale

Willie Newman

Hi, sure. morning, Don. Good

retail we're And and of back, temporary, on between stepping the a margins. competitor-driven and do believe I'll we rates context of and in wholesale really provide some kind it's dislocation that. middle So

Mark the which you total So a basis the channel, points. us for was you in April add and retail the a levels XXX it was of total just far if the XXX to look wholesale revenue, points, which as compensation, basis number, at revenue discussed for under that direct comparable us an as is average broker or revenue

years, in XXXX. the XXXX, retail is points basis distributor you was if the eight points, XXX over in look which last in basis is XXX and which then So direct, low

the provided interest customer disparity And lenders X% to mean, than So to if why relative if I you broker XXX% brokers. by industry wholesale X.X% customer a translate rates and to so direct me, go at higher significant is historic that retail wouldn't rates level, rates to know to don't time. the persists, are I the disparity that norms. of a

real I think much direct-to-retail that not versus I'm wholesale can charge wholesale? are customers and issue. higher further, companies come rates sure think have I persistently distributed a or retail customers' they that in in how that through

I that the the dislocation. So outlines think of nature

As will that Mark of assumption only the revenues recover, said, to wholesale our is eight lows last working years. but the

XXX we points marker basis is was that. XXXX. for at our So in That look

Specifically, But – and the that's compensation, at that revenue XXX under basis look you if you it add was points. broker XXX. and still that back,

better direct. retailer and still for So borrowers materially

focus addressing elements our keep So control. the we is really

accelerating levels. additions, vintage achieve on about, revenue initiatives our the as equity very broker a taking baseline the at expense Mark to will give pace or and actions us So better and we're talked process that increasing rigorous XXXX the and level ability return efficiency Ultimately, of management. activations, additions

But how will how as to will do we recover start this competitor-driven, it determine think long lasts, I really basis far it's no it's to try – it last. As us because it believe to long quarter. for there's

Operator

go the line Piper is Please Our of from Barker with ahead. next Kevin question Sandler.

Kevin Barker

Yes.

or expect given early It you as market just lines? are far seems you quarter. indications would the fairly dislocation. recovery? this those Is any flow there, additional like there to quick, Is recover out something just along you the that productivity see any as you seeing per there where broker mentioned So that

Willie Newman

mentioned certain see recovery the where quarter. didn't level but there's this in margin to morning. I levels Kevin. starting get quarter. recovery. Good now, and that we recovery it's of kind that very small expect we're hey, would to it the would that the start So I that I'd – a not it's dynamics, in signs to rapid say say pricing There's the this this Right Yes, dynamics I'd certainly of mean to think quarter. elements not will

Operator

line next with Vandervliet the of go UBS. is question from Brock Please ahead. Our

Brock Vandervliet

market to from do prioritization you sense appear your you in share? that? How you. you extremely you kind to of fall just of the think focused Thank where this – of versus get do trying of on how and environment, share a market be on Some profitability out competitors

Willie Newman

Yes. Good morning, Brock.

a much as as balance. to possible trying achieve we're So

driven I new think and sign broker share market reach by relationships. and to more the is for ability activate us, our up out

opposed in as to continue to We're point this significant And out. to as is expand business you the as coverage looking the the in So continuing not to channel. to as in grow order price at two down dig leaders. really know, our

saw So we as And run a room you there. lot really of to increased our target. we also, have

new increase into So broker significant new XX% of just broker interest, entrants company. are Home And also into March a with broker the really Point. the sign-ups segment, signing actually seeing in we're in our we're seeing up entrants new about segment, new in

Brock Vandervliet

meaningful that, And share brokers, really long inflow one? if does one, how the driven wallet on transition from up by to someone you? that needle number from two, that elaborate guess, for does how the you signing moves like increase, the could I you just And go? number or Is take

Willie Newman

Sure.

and us, the through they and from I something, brokers internal support teams account drive continue March flow what another to looking need obviously, standpoint, of alternative. guess, growth sign providing a think activation more the and But kind about I optimally go would the going That's reasonable from XX-day they the that amount scale wallet of on then market is quarter. activation interest, especially what's sign-ups anticipate think in. combination as I'd an to is of in-market to our this our rather. at the receive of flow So driving, we're as obviously, say what's nature saying information is and for executives happened both the share that considering in then frame XX-day really, acutely it far in the I'd share next on. about a activations, time get a from time frame. up there you to We in or say and a focused

Operator

next Our Doug of the go the Suisse. from ahead. is question Harter line Credit with Please

Doug Harter

Thanks. Could your gave the funded you between your just talk the for lock just you funded that be about seems and and Can to served talk Box volumes your volume? volume next you dynamic but quarter dynamic? significantly below outlook stability. for about funded, guidance

Willie Newman

Sure, that Doug. to Mark. one I'm going to on pass

Mark Elbaum

Doug. Willie. Thanks, Sure. Hey,

We've a you observed. couple fallout-adjusted in billion. locks, marked $XX have of So billion roughly $X things might

So the in that enabled at. managed were that to the and that certain level one, we suspect starting pull-through a amount there built locked, us day a think dynamics that's lock in expect XXXX, is that are several worthy loans quarter portion capability what of pull-through. And number and up I of note. X, fourth you're on Number first what we service fair to capacity quarter we of I greater issues looking through of fallout-adjusted the

since operational improved some as creating locked the time on that of, At what estimate had improvements. percentage lock So think I on a the capacity be. that result we've said, a loans, in first of pull-through and it's we that we record track day alone like a we that certain we that best pull-through and those terms will

is creates be a other because have a likely is borrower going thing rates in The fall otherwise profound first rate interest less would to they pull-through way and likely rates to an their was increase in happened greater interest higher that increase in want to a that than out the quarter alternative going because had.

end you up with a So pull-through. higher

the saw significant to a terms we lock here dynamic relative in in pull-through volume. pretty quarter first of So

forward, now our and operational about we are. capabilities As what look capacity we more know

a forward, will relationship we pull-through in between that And making so two fallout-adjusted see significant numbers change expect you'll that any I rates. closer going adjustments interest those to expectation. barring would And lock be

Doug Harter

Where better actual does up gain So Mark, does sale? on that experience? of show terms that pull-through in that

Mark Elbaum

at category them – pull-through see be category. other a number That one gain capital then you'll of and you activities, the would provided, channel the look would we the if the other see be level ratio. market that things, there's changes you'll So on other disclosures which of this to includes sale,

we what in attribute and lock is because the day what So pull-through when on then to other alone changes or one other of the of expect channels be we those would category. subsequent to the we loans things value

Operator

question is Rich line with Shane of JPMorgan. from next Our the

ahead your go question. may with You

Rich Shane

lock for increasing hedge much volume? ratio the question. Good locks, the morning, in taking quarter everybody we pull-through and of to my you're that thanks pressure the want about sale I on gain the I'm think describing how function question. for follow-up When on last on curious of second the a as

Willie Newman

take Mark? want also, that You to

Mark Elbaum

and couple that's don't have I in that think, dynamics Number terms we I higher think well, described the it's clearly, of one of think – this dislocation. Sure. is And I pull-through capacity. a dynamics. Willie higher

expected. I room the pressure, that's think in So relationship. the of there's part the economic that was, frankly, terms But demand and in more of supply funnel

I the competitive reason is this think for the dynamic. increased pressure

competitive normalized expected say do we're unique let's of points to I some The would basis we're from, I we be this more that, that but So level XXX a describe now we is with component, in. would has And XXX. to I unrelated. what say, it that the is of think below would environment would which why think go reason

Rich Shane

Thank helpful. guys. both you. sort Thank for thank Got of it. you in of And bucketing That's very you those factors. two

Operator

Ryan Goldman with Nash is Please question go next Sachs. from Our ahead.

Ryan Nash

Hey, morning, good guys.

Willie Newman

morning. Good

Ryan Nash

I as second, interesting on Thanks. guess, follow-up seeing companies different accelerating down to opposed in that the isn't coming the to dynamics stats to are on wholesale pressures but tons relative given the looking capital direct comes given up? margins market, of gave competitive why And retail across just I channel? maybe Willie, that, work, liquidity to in you the some guess, put risk you channels. any are the competitive

Willie Newman

morning. Good Ryan. question, great a that's No, sure. Yes,

level one margins One So obviously, combination. exclusive. come down here. I let's around, can be is let's the they're or where I'll is. to, think anywhere you're not There near or historically, that anywhere call I – a have guess retail happen gotten what could revenue that. match I that And is mutually say, gotten points retail demarcation line. One come two right. things could They say, basis haven't combined is point margins not to that, it, XXX near,

stress down it – it So to to alone be try significant retail, experiencing are what stress let significant distributed we're to I wholesale get on think be the to we would today. levels that think would – in especially those companies normalized for

on the we borrowers, we're are really us should we dynamic facto I more coming direct that we different don't it's again, our because who us through for than our a charge charge – like back side, to – little charge So bit brokers. de feel through

going extent, have having a margins, challenge our higher channel. we're and and should that to so And by direct because in suppressed are a customers go hey, not the to you to rate the seller we're a certain fact our say,

de doing. meaningfully our own I than speak But don't facto I to more are So can't we feel customers charge frankly, what through brokers. others charging comfortable

kind I'll of – say bit and I in nature the therefore, that less there of money book, you look have than at So a book. little also pressure the normalized servicing of call the newer, because mean, pressure I'd is we if there's our it's

come more customers it's as so, that through bit So taking us the ensuring care there. care take of we as our partners. broker there's well pressure customers that of our we're of a But little

Ryan Nash

it. for the Got Thanks color.

Operator

Please from go is Mihir question Bhatia next with Bank America. Our of ahead.

Unidentified Analyst

corresponding [ph] and just XQ correspondent on mean, Mihir. date ask And you're like This credit direct. in for what channel. quarter as to the is Nate I for were the wholesome Richmond seeing be originations I curious, to up what want to well. actually and I'm

Willie Newman

Yes, sure. Good morning.

moderated we We've seeing even of last more pressure saw on quickly, So we more much activity. well. saw and kind normalize – as our a margins correspondent bit those year, little margins we're

portfolio. we as for previously, As aggregation we've an correspondent at talked and servicing our vehicle platform about look primarily

to continue of see So optimizing some production, activity that in we've ensure the expect second you should the moderated our quarter. return to against to level the we're

Unidentified Analyst

Thanks it. Got the for question.

Willie Newman

Sure.

Operator

Piper do line [Operator instructions] with of Kevin the go ahead. have from question Please follow-up We Sandler. Barker a

Kevin Barker

you. Thank near-term it seems But give comments occurring, you can how breakeven? there's comments move broker per that's through operating developing revenue the of for efficiency idea to regarding you're pressure Thanks like but balance around an expenses operating we just a the us Because year-end. year. your as through

inflection start we So what broker At XXXX, as through an you're point channel? that we the move to see you point. to specifically eventually, feel like like can see around do going

Willie Newman

take Mark, want Kevin. that? Thanks, do you to

Mark Elbaum

Sure, Kevin. sure. Thanks,

it, number of right and is the even. If we math think basis is that So I is, servicing assume loan in say, point let's one, kind per for of basis points XX a cost this about. roughly think this – at, breaks our the going I'm now say, average that's just margin. that XX way let's XX, we're purpose to that

aside. But just over let's time and unprofitable slows, put think to will that us. as amortization I seeing servicing already become we're that,

cover $XX to million of overhead, X. divided have about We by a million $XX month

a going think we'll period, you rate. we're be but point expecting gains below and that one. number to fund margins, well efficiency don't leads run The And how in those we're We period we think we're circa $X it don't we're a billion we number we for that And that don't – two, create in XX. will basis long be comfortably long billion, month. That's on $X be environment XX do of So will a protracted. that know time. to improve to

on aren't benefit the basis do will we from they XXX that. that, beyond extent margins points. much course, However, planning To our of also the grow

adding we're couple So should and the that activate able the ensure to that that volume. fact, additional to of are, with brokers all by that that get in platform fact we you

– So hopefully, to we improve with sorry, that's the our problem brokers addressing should ahead, go far And platform, to think But the into about good go as and I question. regards we add continue long-term have cost future. if ahead, to your returns showing the no Willie. then profitability, as

Willie Newman

I – a the actually, don't. isn't but what is it's se side that on been we've There decrease because fairly basis of we is lot is, leaders, steady. sales. of the things reduced I there the dependent kind force. revenue would point obviously, that not this our a point actually is – They've people say month we've our done is. inflection is really typically People cost really to sales compensation of per – one But mean, look at

has force sales our us become more So helping actually been leader a in cost competitive.

as a So the range we're steady during expect get year. from will decline time cost the that. But to to Mark a going inflections overall, said, a the from in fairly there be that down to we there are certain able standpoint. volumes where benefit in points be it's be But

Kevin Barker

talking sale And just your not channel, a a breakeven that to to whole, level you're wholesale right? as margin a company gain on clarify, is about specifically as on

Mark Elbaum

well, – the be – so would yes. It

me whole. focus wholesale a sale XX%, company clarify would my in comments basis our be on XX as business, with The as that's, channel gain the basis because that. on whole. but tend a frankly, points, margins the the to points respect to Let company XX XX% I of were

Kevin Barker

Okay. my Thank you taking for questions.

Operator

And we time. this questions speakers, no at have further

You with or your remarks. closing may presentation continue

Willie Newman

Great. us speaking look joining contact any quarterly Thanks, this me to call. and Thanks you everyone if to for our forward questions, feel for have free again we'll morning earnings soon. with Please you operator.

Operator

today. you participation day. your that great And conclude you for Have We that for the thank your does ask kindly disconnect lines. conference and a call all please

Home Point Capital (HMPT) 8 May 212021 Q1 Earnings call transcript